File EncryptionProtect your privacy!Losing a laptop, or having it stolen, can make your heart freeze. Not only are you out a thousand bucks (or more), but suddenly a stranger can read your email, see your income tax files, and maybe admire your company's top-secret strategy for the next year.

But you have a great tool to protect that data from prying eyes: file encryption. When files are encrypted, only people with the password can use or read them. It's the absolute best way to maintain your privacy if someone nasty gets their little hands on your computer.

What does file encryption software do?Encryption software takes data, like your tax files (or your 007 mission profile), and encodes it so that no one can read it without the "key" (associated with your password).

This code, like the key, is created using a mathematic algorithm that we can't explain here (because we don't understand it ourselves!). But once created, it's very secure and any person or computer trying to look at your file just sees a bunch of gobbledygook.

Then, once you've signed in to your computer to do your taxes (or attack the evil fortress), the software turns all the gobbledygook back into recognizable form.

In most cases, it's not hard to set up and you never need to worry about all the math.

A password will help block bad guys from getting into your operating system (like Windows XP or Mac OS X). In most cases, that could be enough, because the average run-of-the-mill thief may not bother going further than that.

But a professional thief, making his living from credit card numbers or company secrets, may have a few more tricks up his sleeves.

For one thing, though the password protects access to your operating system, it doesn't stop anyone from physically removing your hard drive (which contains all your data) from your computer. Once they hook up your hard drive to a different computer, they can see whatever they want.

Unless the files on the hard drive are encrypted, that is. If they're encrypted, then there's not a thing a thief can do.

Really? Not a thing the thief can do?Well, never say never, but today's best encryption software is powerful stuff. If a thief bothered to try and crack the code (and had a government computer to help), it could still take millions of years or more to do the job. Even including time spent waiting on hold, that's probably enough time to cancel your credit cards.

A Caveat...While encryption keeps your files safe from prying eyes, it doesn't really keep them safe from being tampered with. If you recover a stolen computer, you can't be completely sure that your data still says what it used to. If it's critical information, throw it away and use your back-up data. (You did back up your data, right?)

But do I really need millions of years of protection?Maybe not! If your computer never leaves your house, and you use it for family emails and photos, you may not want to bother with encryption.

But if you use a laptop, keep files with company (or personal) secrets, or are generally concerned about privacy, you should think seriously about protecting your data.

Another consideration is how often you forget passwords. Encryption is powerful, and usually the only way to unencrypt a file is to use the password. If you forget the password, that data is gone. Forever.

Enough theory. How do I encrypt?If you have Windows XP Pro or Mac OS X, encryption is already built in, and you just have to turn it on (see how below). In fact, you won't even have to remember another password, because your operating system sign-in password will automatically control the encryption.

HINT: Encrypting and unencrypting files can slow down your computer. So if you like editing video footage or music on your computer, you might want to store those files in a place that's not encrypted.

Right-click the file or folder you want to encrypt and choose Properties to open the Properties screen.

Click the Advanced button to open the Advanced Attributes screen.

Check the Encrypt contents to secure data box.

Click OK to save your change and close the Advanced Attributes screen.

Click OK to close the Properties screen.

That's it! When you sign in to Windows using your sign-in password, your file will be unencrypted and ready to go. If you don't sign in, no one will be able to read it.

Mac OS X:Mac OS X allows you to encrypt your entire Home folder at one time.

From the Apple menu, choose System Preferences.

Click the Security icon to open the Security preference panel.

Choose Turn On FileVault.

Mac OS X will sign you out of your profile, then will work for a while, encrypting your entire Home folder. The next time you sign in, your files will automatically be unencrypted and ready to use. If you don't sign in, no one will be able to read any of your personal files.

Earlier Windows or Mac OS systems:If you're using an earlier version of Windows or Mac OS (or XP Home), you may have to install some third-party encryption software. Some examples: